Kazakhstan on Pace to Attain High-Income Nation Status by 2028, According to EDB Projection
Hitting the Big Leagues: Kazakhstan Set to Join High-Income Nations by 2028-2029
Stay tuned as energy-rich Kazakhstan prepares to enter the elite club of high-income countries by the end of the decade, according to a Macroeconomic Forecast by the Eurasian Development Bank (EDB).
Witness Kazakhstan's impressive economic journey over the past three decades, highlighted by the EDB's latest forecast. The Central Asian gem has seen its real GDP per capita triple, sprinting past the global average. Unlike its global counterparts, this economic juggernaut has seen life expectancy surge by 11 years, unemployment plummet six points to 4.8%, and extreme poverty all but vanish.
EDB's top economist, Evgeny Vinokurov, shared the driving force behind Kazakhstan's meteoric rise: diversification and strategic investments, backed by ambitious state initiatives to develop infrastructure and key industries. The manufacturing sector, especially the machine-building industry, led the charge, contributing three percentage points on average to Kazakhstan's industrial growth from 2019 to 2024.
Kazakhstan's economic evolution won't slow down anytime soon. The government plans to fund over 50,000 projects annually through a new state support program for businesses, with a projected budget of 10 trillion tenge (US$20 billion) by 2027.
But success doesn't come without challenges. High-income status will require a shift in Kazakhstan's economic growth model, with a focus on international specialization, human capital development, and institutional reforms.
The global economy painted a mixed picture in early 2025. Emerging economies showed substantial expansion, led by India (6.5%), Indonesia (5.0%), China (5.0%), and Brazil (3.7%). The United States growth tailed off slightly (1.6%) due to waning consumer confidence and business activity, while the EU struggled to shake off energy costs and declining industrial output, particularly in Germany (-4.6%). China, on the other hand, remained resilient, thanks to government stimulus and export growth.
As Kazakhstan approaches high-income country status, it could unlock new investment opportunities, strengthen economic resilience, and gain access to lower-cost financing. This transition will also necessitate a shift in the country's economic growth model, emphasizing international specialization, human capital development, and institutional reforms.
Insights:
- The Tengiz Field upgrade has been a significant contributor to Kazakhstan's oil production and economic growth, increasing budget income (Source: [3], [5]).
- Oil and gas revenues, constituting around 35% of Kazakhstan's GDP and 75% of exports, are critical for its economy (Source: [3]).
- Kazakhstan aims to reduce its dependency on oil by promoting non-oil sectors like information technology, manufacturing, and agriculture (Sources: [1], [3]).
- Strong public spending on infrastructure and social sectors is expected to support ongoing economic growth (Source: [3]).
- Accelerated implementation of structural reforms and improvement of the investment climate are essential for sustained growth (Source: [3]).
- Managing oil production to stay in compliance with OPEC+ agreements while preserving economic benefits poses a challenge (Source: [5]).
- Human capital enhancement and infrastructure development are crucial to improve productivity and support economic activities (Source: [1]).
As Kazakhstan transitions into a high-income country, it may attract more investments, bolster economic resilience, and gain lower-cost financing opportunities. To maintain this growth, focusing on international specialization, developing human capital, and enacting institutional reforms will be crucial. In light of the Tengiz Field's significant contribution to the country's oil production and economic growth, diversifying into sectors like information technology, manufacturing, and agriculture may help reduce dependence on oil revenues.
